Includes $2 million for Greenville County and $650,000 in legal fees

A Circuit Court judge has approved the settlement of a lawsuit filed against Greenville Health System by local legislators that calls for GHS to pay $2 million a year to Greenville County and its six cities.

But whether that will settle the tensions between the hospital and the legislators is uncertain.

The settlement, which was approved Thursday by Judge Roger M. Young Sr. of the 13th Judicial Circuit, encompasses provisions of a compromise bill passed earlier this year aimed at ending the lawsuit, including the $2 million payment.

“The terms of the Senate bill that passed the House of Representatives and became law are included in the settlement,” said James Carpenter, attorney for members of the Greenville County Legislative Delegation, two Greenville County Council members and the South Carolina Public Interest Foundation, all of whom originally sued the hospital.

“And that includes having GHS pay $2 million a year to Greenville County and the cities in Greenville County," he said.

The plaintiffs said that GHS doesn't pay property taxes on most of its real estate holdings. GHS, as a nonprofit, is exempt from property taxes.

Legal fees and costs

The settlement also calls for GHS to pay up to $650,000 of the plaintiffs’ legal fees and costs, Carpenter said.

While the plaintiffs originally wanted the restructuring to be rescinded, Carpenter said the General Assembly gave it retroactive approval in the compromise bill, whose terms were approved in the settlement.

“They wanted language in the settlement that we agree that what they did is now legal,” he said, “and since the passage of the legislation by the General Assembly, we basically agreed to that point as well.”

“We are grateful that a settlement has been approved — and very much appreciate the support of legislators, physicians, employees, patients and the many community members who worked with us to find common ground,” she said.

“We are pleased to be able to focus our full attention on doing what we do best —providing outstanding patient care to our communities,” she added.

State Rep. Garry Smith, who was among the plaintiffs, said legislators felt they were able to achieve more with the settlement than they could have with the suit.

The settlement also includes the ability of the nonprofit board to make policy decisions, which had been taken away by the private entity; includes members from Pickens and Laurens counties as part of the board structure; and allows a citizen representative to have a say in appointing board members, Smith said.

Garry Smith(Photo: Submitted)

“There was an issue with the board and how it is set up so that the representation is fair and equal and that a citizen representative has an opportunity to decide who is appropriate to represent them from the community,” he said. “That was key to the settlement.”

State Rep. Mike Burns, another of the plaintiffs, said the settlement was the best path forward, since the suit would have gone on for years.

“This thing would have gone on and on and that wouldn’t have been good for anybody ... and that was going to continue to divide the delegation and the community,” he said.

“I’m glad we finally got some of the things we wanted. We didn’t get everything, but I’m happy with it,” he added. “I’m happy that the local board has some control that it didn’t have ... and that the county got some money back that it wouldn’t have gotten.

“Most of all I’m glad we can focus on something else now.”

'Years of fighting'

But Smith said it will take time to mend fences between the legislators and GHS.

“There is still a lot of distrust there because of what has happened and almost three years of fighting,” he said.

“There is a lot of work has to be done to get beyond that," he added. "Those wounds aren’t going to heal quickly.”

“The relationship is 10,000 times better than it was a few months ago,” he said. “And whatever animosity might be left, time will take care of that.”

Mike Burns(Photo: Submitted photo)

The lawsuit, filed in 2016, alleged among other things that GHS had violated the 1947 act that created the public hospital system when it restructured, turning over governance of the system to a private, nonprofit entity.

It sought to rescind the restructuring, to return public assets to the public and to restore governance of GHS to comply with the 1947 act.

In February, a bill to sell GHS was introduced by eight members of the delegation that called for dispersing the proceeds of the sale — which they estimated at between $2 billion and $3 billion — among various governmental, educational and other groups.

Legislators said they took the step because public trust was shaken when GHS “unilaterally restructured and leased our publicly-owned, multi-billion-dollar asset without the legislative delegation’s input or consent as the law requires.”

Community input

The compromise bill that subsequently passed dropped the sale idea and increased the amount of Healthy Greenville grants from $80 million to $100 million over 25 years.

It also gave members of the delegation the ability to offer input on community needs in the Healthy Greenville grant process, among other things.

The settlement was dismissed with prejudice, which means the suit can’t be brought again, he said.